Why These Questions Matter
California's private lending market includes a wide range of lenders, from long-established DRE-licensed firms with decades of funded loans to less experienced operators whose terms, disclosures, and reliability vary significantly. A bridge loan is a short-term but substantial transaction. You are placing your home equity and your home purchase timeline in a lender's hands. Knowing what to ask before you commit is how you protect yourself.
The questions below are designed to surface the information that matters most: licensing, costs, timeline, and track record. A good lender answers all of them clearly and promptly. Evasive or vague answers to any of these are a meaningful signal.
Are you licensed to make real estate loans in California?
Ask which license the lender or broker holds. California real estate loans are usually made or arranged under a California DRE real estate broker license or a DFPI license (California Financing Law or California Residential Mortgage Lending Act). Loan originators also carry an NMLS ID, which is a registry number rather than a license. Ask for the license number and verify it yourself at dre.ca.gov or nmlsconsumeraccess.org. Do not skip this step.
What is the exact interest rate, and how is it calculated?
Bridge loan rates in California currently run from roughly 9.95% to 10.95% (APR 11.40% to 13.22%) on first-lien loans for standard residential transactions. Ask whether the rate is simple interest on the outstanding balance or calculated another way. Monthly payments are required.
How many points will I pay, and what are all closing costs?
Points should be disclosed upfront, not buried in a term sheet delivered the day before closing. Ask for a complete written cost estimate that includes points, title insurance, escrow, recording, and any other fees. Reputable lenders provide this without hesitation.
Is there a prepayment penalty?
Some private lenders charge a minimum interest period or prepayment fee that means you pay for months you did not use. Ask this question directly and get the answer in writing. North Coast Financial charges no prepayment penalty.
How long will it take to close my loan?
Owner-occupied bridge loans in California are consumer loans covered by federal disclosure rules: the Loan Estimate must be delivered at least 7 business days before closing and the Closing Disclosure received at least 3 business days before closing. In practice that means about 2 to 2.5 weeks to fund. Investment property loans can fund in about 7 days once the file is complete. Any lender claiming they can close an owner-occupied loan in three days is either mistaken or taking shortcuts with disclosure requirements.
What is the maximum LTV you offer?
Standard California residential bridge loans go up to 65 to 70% LTV. Some lenders advertise higher numbers but add conditions that reduce the effective loan amount. Get the maximum LTV in writing and confirm how the existing mortgage balance factors into the calculation.
Do you require an appraisal?
Traditional appraisals add $500 to $1,000 in cost and 1 to 2 weeks to the timeline. Many private bridge lenders, including North Coast Financial, do not require a formal appraisal and use other valuation methods instead. Confirm this upfront so there are no unexpected fees or delays.
What is the maximum loan term?
North Coast Financial offers terms up to 11 months. Some lenders limit terms to six months, which may not give you enough runway if your sale takes longer than expected. Know the maximum before you commit.
How many bridge loans have you closed in California?
Experience matters. A lender who has funded hundreds of California bridge loans understands the specific regulatory requirements, title nuances, and market dynamics. Ask specifically about California residential bridge loans, not just overall loan volume.
Can I speak with a past borrower?
References are a reasonable request for a transaction of this size. An established lender with satisfied borrowers should be willing to connect you with past clients who can speak to the experience. Online reviews and testimonials are also worth researching independently.
Licensed: DRE Broker #01870870, NMLS ID 323044. Rate range on first-lien loans: 9.95% to 10.95% (APR 11.40% to 13.22%); second-lien loans are priced higher. Points: 1.25 to 1.95. No prepayment penalty. No appraisal fee. Owner-occupied: 2 to 2.5 weeks. Investment: about 7 days once the file is complete. LTV: up to 65 to 70% of the property value, based on North Coast Financial's in-house valuation (we do not order an appraisal). Term: up to 11 months. Track record: over $1 billion funded since 1981.